Newshour, $140m lost after death of cryptocurrency exchange boss

07 February, 2019, 13:46 | Author: Frank Williams
  • Avoiding QuadrigaCX's $190 Million Disaster How Do the World's Largest Crypto Exchanges Store Funds? 1

Quadriga has been scrambling to sort out $250-million in debts owed to its users after it reported the sudden death of its CEO Gerald Cotten in December. The company said he was planning to open an orphanage when he passed.

Customers of a Canadian cryptocurrency exchange are reportedly unable to access $190 million of funds after the company's founder died with the passwords needed to access the money.

Robertson was not involved in the business.

The saga, just unfolding in the western media, goes back to December when Gerald Cotten, 30-year old founder of QuadrigaCX, died due to complications with Crohn's disease, according to the company and Cotten's wife, Jennifer Robertson. That's a big problem for investors because the exchange's founder, who had encrypted access to the money, died previous year. "Further updates will be issued after the hearing".

A cryptocurrency exchange in Canada has revealed they can't repay most of their clients' $190 million in Bitcoin, Litecoin, Ether, and fiat currency holdings, and no, it wasn't because of a 51 attack. An additional CA$70 million ($53 million) is in the form of government currency. Users' cryptocurrency wallets were kept offline, ensuring hackers couldn't get at them.

QuadrigaCX and its affiliated companies are registered in British Columbia, but it has no offices, no bank accounts and no employees, aside from a handful of contractors.

"Quadriga's inventory of cryptocurrency has become unavailable and some of it may be lost", she wrote.

Robertson says that she has no business information for Cotten's company or its affiliates and that all she has is the laptop that likely contains the information they need to unlock Quadriga's cold storage system. Based on company records, she said the cold wallet stored $180 million in Canadian dollars ($137 million in United States dollars), all of which is now inaccessible to QuadrigaCX and more than 100,000 customers.

"I do not know the password or recovery key", Robertson said. So effectively, QuadrigaCX's CEO died with the customers' money on his encrypted laptop.

More news: Bickering blurs message of unity during State of the Union

The statement added: "Unfortunately, these efforts have not been successful".

"This is a tough lesson learned".

Calgary customer Elvis Cavalic, who bought a few hundred dollars of Bitcoin using Quadriga's platform, told CBC that he couldn't withdraw $15,000 from his account. "I'm kind of preparing for the worst".

She noted she had received threats and slanderous comments and had seen "a significant amount of commentary on Reddit and other web-based platforms about Quadriga, Gerry's death (including whether he is really dead) and missing coins".

Very little cryptocurrency was stored in the latter for security purposes.

"If this can not be done in an orderly fashion, many, if not all users, may suffer damage", she wrote.

On 31 January the company's board of directors applied for creditor protection, with Ernst & Young expected to be appointed on Tuesday to oversee the proceedings. You simply sign into the exchange, trusting that it will secure your funds.

However, Quadrigas access to cash has been “severely compromised” by its inability to negotiate bank drafts provided by the payment processors.

Recommended:



Popular

Earth’s magnetic north pole is shifting toward Russian Federation , scientists say
The model uses the latest data to predict how the magnetic field and two magnetic poles will move in the years in-between updates. Scientists have, however, noticed in recent years an increased rate at which the pole appears to shift from location to location.

Asia Greets Year of the Pig, Farewells the Dog
Buddhists believers light candles during celebrations to mark the Year of the Pig at the Jogye temple in South Korea. In 2018, air pollution records were heightened within the first four days after Chinese New Year was celebrated.

Possible measles case reported in Bell County
The case involves a child in western Bell County who was either not vaccinated or had not completed the vaccine series. Two doses of the measles vaccine protect against measles in 97% of cases, according to the CDC .

Russian Federation treaty under strain
The move came in response to Secretary of State Mike Pompeo announcing the US would pull out of the agreement last week. Why did the U.S. pull out of the pact? This will not start an arms race; one has been going on for 10 years at least.

20,000 homes at risk in Australia floods as crocodiles, snakes wash up
Two men are feared missing near floodwaters as the deluge that's caused catastrophic flooding in Townsville shows signs of easing. "I want to assure the community that we're doing everything we can do keep them safe", he said . "We'll be all right".

Chelsea boss Sarri hails Hazard and Higuain’s new partnership
Hazard is widely regarded as one of European football's top attacking talents and he has been in good form for Chelsea FC so far this season.

WhatsApp for iOS enables Face ID, Touch ID for iPhone
If you have them turned on then you'll be able to both see and reply to any messages without having to unlock the app. Hopefully this is an added layer of security that more messaging and social media apps will implement in the future.

‘Living fossil from the early universe’: Hubble spots new galactic neighbor
Not only is it one of just a few dwarf spheroidals that have a well established distance but it is also extremely isolated. Granted, galaxies are anything but "small", but compared to our absolute unit of a galaxy , Bedin 1 is a featherweight.

Groundhog Day gets a VR game sequel for Oculus, Vive, & PS VR
Other towns have their own groundhog mascots as well, including Birmingham Bill in Alabama and Staten Island Chuck in NY . Saturday marked groundhog day and the most famous wood-chuck, Punxsutawney Phil, is calling for an early spring.

Brilliant Messi nets brace as Barcelona,Valencia share spoils at Camp Nou
Little did it matter that Messi had just struck two goals to lead Barcelona back from a two-goal deficit to secure a 2-2 draw. Parejo doubled the advantage from the penalty spot after Roberto knocked down Wass trying to dispute a cross.